Paving the Way to the American Dream State Impact: Immigration Reform Could Increase California Tax Revenue, Shift Worker Base

By Bradley, Eric | Daily News (Los Angeles, CA), January 29, 2013 | Go to article overview

Paving the Way to the American Dream State Impact: Immigration Reform Could Increase California Tax Revenue, Shift Worker Base


Bradley, Eric, Daily News (Los Angeles, CA)


Granting residency to undocumented immigrants in California could increase competition for low-end jobs as agricultural laborers shift to cities, while boosting tax revenues as other undocumented workers seek higher-paying positions previously denied to them, experts said.

Other potential economic and political effects were being considered across the state after a bipartisan group of eight U.S. senators unveiled plans Monday that would provide a path to citizenship for the country's 11 million undocumented immigrants.

A vote providing legal status could occur in the Senate by late spring or summer, according to one of the proposal's sponsors, Sen. Charles E. Schumer, D-New York.

Though the agreement is dependent on first securing the nation's borders, some said that the most likely outcome - the movement in the job market - has been seen before, in the 1980s, the last time immigration laws were significantly revised.

Then, agricultural workers moved to areas cities such as Los Angeles, putting downward pressure on wages for low-end jobs, according to Julie Weise, an assistant professor of international studies at Cal State Long Beach.

"We could see something like that again," said Weise.

As those positions dry up, some immigrants may head out of state to look for work elsewhere, but those who remain would stimulate local economies by spending more.

"Think about having your life here now, having your kids here and being deportable," Weise said. "Picture that person getting legal status. Maybe they're going to want to buy a house here. Maybe they're going to want to buy a car here."

Studies have shown that about half or more of California's approximately 2.6 million undocumented immigrants pay taxes.

The Social Security Administration assumes that about half of undocumented workers pay Social Security taxes, a 2005 report said, while a 2006 survey of undocumented immigrants by the Center for Comparative Immigration Studies at the University of California, San Diego, found that 75 percent had taxes withheld from their paychecks, filed tax returns, or both.

Weiss expects those numbers to increase under a new amnesty, and higher tax collections could be realized since many illegally living in California work in positions below their skill level because their legal status isn't highly scrutinized. …

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